Office of Medicaid (MassHealth) — Review of Capitation Payments

MassHealth made an estimated $84,832,094 in capitation payments to MCOs on behalf of members who were residing outside Massachusetts (in nine other states and Puerto Rico), based on a sample of 100 members; 63 members in the sample had moved to another state or territory and continued to receive capitation payments for periods ranging from 5 to 45 months. The audit identified weaknesses in residency verification controls, including reliance on PARIS data matches without timely follow-up, and limited access to the Transformed Medicaid Statistical Information System (T-MSIS).

Revise policies and procedures regarding data matches for member eligibility; require that all members flagged by data matches provide documentation to substantiate Massachusetts residency; if documentation is not provided, pause coverage or move to fee-for-service until determination is made.

Investigate and resolve all instances where data matches indicate a member is enrolled in another state's Medicaid program.

Provide members with written instructions during the annual enrollment process on how to unenroll from MassHealth if they move outside Massachusetts.

Consult with CMS to determine if MassHealth can gain access to T-MSIS for eligibility detection and residency verification.